May Chgo Wheat closed 11 ¼ cents lower ($5.10 ½), July 12 ¾ cents lower ($5.01 ¾) & Dec 11 ½ cents lower ($5.16)
May KC Wheat closed 25 ½ cents lower ($4.58), July 15 cents lower ($4.54 ¼) & Dec 14 cents lower ($4.74 ¼)
May Mpls Wheat closed 5 ½ cents lower ($5.00), July 12 ¾ cents lower ($5.08 ¼) & Dec 10 ½ cents lower ($5.33 ¼)
“Smart” guys were trying to say world wheat stocks are tightening once the Chinese stocks are taken out of the mix. That may be true but it did absolutely for the market today. It seems the trade returned its focus to the current beneficial weather for the developing winter crop as well as forecasts that suggest better conditions for the spring crop.
Interior basis levels for standard protein wheat continue to run unchanged. The Gulf appears to be continuing to ease for HRW while being steady to better for SRW. Both Chgo and KC spreads showed a widening bias reflecting the spec selling.
The mid-$4.90’s was an interim low back in mid-March for July Chgo. That appears to be up for testing relatively soon. The first test of this level is deserving of a bounce so I caution chasing the break beyond this level. As of this writing the KC market is showing a greater degree of short term oversold vs. Chgo. For as ugly as this market looks I have to think we’ll see some bouncing off of any further sell-off.
Daily Support & Resistance – 5/14
July Chgo Wheat – $4.96 – $5.10
July KC Wheat – $4.50 – $4.65
The risk of trading futures and options can be substantial. Each investor must consider whether this is a suitable investment. Past performance is not indicative of future results.